Co-investments are one of the most powerful tools in a VC firm's arsenal. They let fund managers increase exposure to their best portfolio companies, give LPs direct access to high-conviction deals, and strengthen relationships across the investor base.

Khwarizmi Ventures understood this well. As one of Saudi Arabia's leading early-stage VC firms, the team had built a reputation for backing high-growth companies across the GCC and delivering differentiated access to their investors. Led by Managing Partner Abdulaziz Al-Turki, Khwarizmi utilizes co-investment vehicles to increase its exposure to select portfolio companies by providing LPs with direct access to these opportunities, thereby creating additional value for them.

But as co-investments became a core part of their strategy, the process behind them started to create a different kind of problem.

The Challenge

Co-investment workflows are complex and time-consuming, creating operational bottlenecks for fund managers like Khwarizmi Ventures.

Co-investment vehicles are essential to Khwarizmi's strategy, but building and managing them internally was slowing their operational scalability.

Before Zest, the team constructed SPVs similarly to a new fund. Each new vehicle required:

• Creating a new legal entity
• Completing extensive registry and compliance steps
• Opening a new bank account for every SPV - just to collect investor funds once
• Handling wiring, document execution, and banking logistics manually
• Paying high administrative and legal fees per vehicle
• Annual reporting requirements and ongoing fees

The process created major operational drag.

"It was a nightmare," Abdulaziz shared. "Cost-wise, it was higher, time-wise, it was longer, and basically, mental capacity was more consuming than how we're doing it with Zest now."

Co-investments were going to continue to be a core part of Khwarizmi's strategy as the firm grew: the team needed a solution that was faster, digital-first, and built for repeatability.

The Solution

Zest offered Khwarizmi a modern infrastructure for their co-investment strategy

Zest provided Khwarizmi Ventures with an end-to-end digital platform to create and execute co-investment vehicles, tailored to their needs, with speed and simplicity.

"Leveraging the digital platform compared with doing it manually is much more efficient," Abdulaziz said.

With Zest, Khwarizmi was able to:

• Create SPVs without having to worry about the administrative burden
• Use digital onboarding and investor identity verification
• Execute all signatures and documentation online
• Manage investors, allocations, and money movement through a single dashboard
• Reduce administrative overhead and eliminate unnecessary banking steps

But Zest is more than a digital platform. We understood the importance of Khwarizmi having a true partner to solve their operational headaches.

"We have trust in the company and the leaders," Abdulaziz noted. "The answer is always yes, we'll figure it out - even if they haven't done it before."

Even in Zest's earliest days, Khwarizmi was confident in partnering because of the team's integrity, responsiveness, and commitment to building alongside their clients.

"When we did our first SPV with Zest, it was one of the first for them. But we were comfortable doing it because of the trust and professionalism of the founders. Since then, we have done more SPVs and hope to continue in the future."

The Impact

Faster SPVs, lower costs, and a scalable co-investment program for Khwarizmi

Zest has helped Khwarizmi execute more co-investment vehicles, with significantly less time, cost, and stress.

Faster execution: Creating an SPV is now much simpler. Zest digitized the entire process, cutting weeks of manual legal and administrative work for each deal.

Meaningful cost reduction: By reducing administrative and operational complexity, Khwarizmi lowered its per-vehicle cost.

Scalable workflow for co-investments: A scalable, trusted process for creating co-investment opportunities enables Khwarizmi to provide its LPs with valuable access to oversubscribed deals.

"We also have investors and LPs that think of us as a source of access to deals that they otherwise would not get on their own," Abdulaziz said. "We give them access because they are investors with us."

‍

Want to see how Zest can support your co-investment programme? Book a demo.